In a document recently circulated to EU governments, the committee laments that no internal monitoring unit has been set up independent of investigations. External monitoring is described as “very limited”. The committee notes that the EU ombudsman has no powers to check on the legality of OLAF’s work.

The committee warns that OLAF may suffer from a “weakened credibility” because it does not pay sufficient heed to legal issues during its investigations. Although its probes are formally considered administrative, the panel warns that because the results are often handed over to prosecutors working in the criminal law field, they encroach on individual rights.

Chaired by the former Interpol chief Raymond Kendall, the five-member supervisory committee has had a troubled relationship with OLAF’s Director-General, Franz Hermann Brüner. Kendall last year accused OLAF of having German journalist Hans-Martin Tillack, arrested “on the basis of hearsay”. Tillack contests claims that he bribed an OLAF official for obtaining internal papers.

Brüner has accused the committee of trying to undermine OLAF’s handling of the fraud scandal in the EU’s statistics office, Eurostat, by leaking classified material to an official implicated in the affair.

The committee’s report says that OLAF has an ambiguous relationship with national authorities in the Union’s member states and that no clear guidelines have been drawn up to improve that situation.

The committee recommends that the OLAF magistrates unit – which handles relations between it and national authorities – should have a role in monitoring the legality of investigations.

A spokesman for OLAF declined to comment on the substance of the committee’s findings. He would only say that the magistrates unit was involved in all stages of OLAF’s investigations.

Austrian Socialist MEP Herbert Bösch warned Brüner to desist from alleging that the supervisory committee was trying to hamper his work. “If there is any evidence, please come forward with it,” he said. “If there is not, then people should be very careful about what accusations they make.”